US Secretary of State Madeleine Albright has applauded Algerian President Abdelaziz Bouteflika's will to reform and widen the scope of his foreign relations.

The American met Bouteflika in Algiers on Tuesday at the signing of a peace pact between Ethiopia and Eritrea. She said Washington was hoping to improve relations with President Bouteflika's government.

Replying to questions from journalists accompanying her to Budapest, Albright said she regretted that the US and Algeria had not in past years had a productive relationship.

She noted continuing violence in Algeria, but observed: "Bouteflika is working very hard with his people to try to work on some reforms and try to move and try to move the process forward."

The Algerian president, "a really interesting man," had "a desire to broaden the scope of his relationships," she said.

Algeria has since 1992 been wracked by insurgency by armed Muslim fundamentalists, but Bouteflika offered a partial amnesty for six months from July last year which saw hundreds of them lay down their arms.

The Algerian security forces have declared a merciless war on those who are still waging the guerrilla and terrorist campaigns that have claimed at least 100,000 lives, while Bouteflika has put his previously isolated country firmly back on the international map since he was elected in May 1999.

Turning to Algeria's role in the Middle East peace process, Albright said Algeria had been "obviously one of the countries at the OIC (Organisation of the Islamic Conference) meetings that has spoken out in ways that could be ultimately helpful."

In Algiers on Tuesday, Albright also congratulated President Bouteflika on what she called the "incredible role" he had played in peace negotiations between Ethiopia and Eritrea.

On her first visit to Algiers in her current job, she said Bouteflika's contribution to the comprehensive peace pact was an example of good cooperation between Algeria and Washington, and that such ties should be strengthened.

The joint efforts to end a two-year war which claimed tens of thousands of lives in the Horn of Africa were "an example of how we can work together," Albright said.

Bouteflika was chairman of the Organization of African Unity (OAU) when Eritrea and Ethiopia signed an initial ceasefire to bring their conflict over disputed border territory to an end in June -- BUDAPEST (AFP)